Public Act 93-0288
SB1150 Enrolled LRB093 09649 LRD 09888 b
AN ACT concerning insurance.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Insurance Code is amended by
changing Sections 500-10 and 500-135 and adding Section
500-107 as follows:
(215 ILCS 5/500-10)
Sec. 500-10. Definitions. In addition to the
definitions in Section 2 of the Code, the following
definitions apply to this Article:
"Business entity" means a corporation, association,
partnership, limited liability company, limited liability
partnership, or other legal entity.
"Car rental limited line licensee" means a person
authorized under the provisions of Section 500-105 to sell
certain coverages relating to the rental of vehicles.
"Home state" means the District of Columbia and any state
or territory of the United States in which an insurance
producer maintains his or her principal place of residence or
principal place of business and is licensed to act as an
insurance producer.
"Insurance" means any of the lines of authority in
Section 500-35, any health care plan under the Health
Maintenance Organization Act, or any limited health care plan
under the Limited Health Service Organization Act.
"Insurance producer" means a person required to be
licensed under the laws of this State to sell, solicit, or
negotiate insurance.
"Insurer" means a company as defined in subsection (e) of
Section 2 of this Code, a health maintenance organization as
defined in the Health Maintenance Organization Act, or a
limited health service organization as defined in the Limited
Health Service Organization Act.
"License" means a document issued by the Director
authorizing an individual to act as an insurance producer for
the lines of authority specified in the document or
authorizing a business entity to act as an insurance
producer. The license itself does not create any authority,
actual, apparent, or inherent, in the holder to represent or
commit an insurance carrier.
"Limited lines insurance" means those lines of insurance
defined in Section 500-100 or any other line of insurance
that the Director may deem it necessary to recognize for the
purposes of complying with subsection (e) of Section 500-40.
"Limited lines producer" means a person authorized by the
Director to sell, solicit, or negotiate limited lines
insurance.
"Negotiate" means the act of conferring directly with or
offering advice directly to a purchaser or prospective
purchaser of a particular contract of insurance concerning
any of the substantive benefits, terms, or conditions of the
contract, provided that the person engaged in that act either
sells insurance or obtains insurance from insurers for
purchasers.
"Person" means an individual or a business entity.
"Rental agreement" means a written agreement setting
forth the terms and conditions governing the use of a vehicle
provided by a rental company for rental or lease.
"Rental company" means a person, or a franchisee of the
person, in the business of providing primarily private
passenger vehicles to the public under a rental agreement for
a period not to exceed 30 days.
"Rental period" means the term of the rental agreement.
"Renter" means a person obtaining the use of a vehicle
from a rental company under the terms of a rental agreement
for a period not to exceed 30 days.
"Self-service storage facility limited line licensee"
means a person authorized under the provisions of Section
500-107 to sell certain coverages relating to the rental of
self-service storage facilities.
"Sell" means to exchange a contract of insurance by any
means, for money or its equivalent, on behalf of an insurance
company.
"Solicit" means attempting to sell insurance or asking or
urging a person to apply for a particular kind of insurance
from a particular company.
"Terminate" means the cancellation of the relationship
between an insurance producer and the insurer or the
termination of a producer's authority to transact insurance.
"Uniform Business Entity Application" means the current
version of the National Association of Insurance
Commissioners' Uniform Business Entity Application for
nonresident business entities.
"Uniform Application" means the current version of the
National Association of Insurance Commissioners' Uniform
Application for nonresident producer licensing.
"Vehicle" or "rental vehicle" means a motor vehicle of
(1) the private passenger type, including passenger vans,
mini vans, and sport utility vehicles or (2) the cargo type,
including cargo vans, pickup trucks, and trucks with a gross
vehicle weight of less than 26,000 pounds the operation of
which does not require the operator to possess a commercial
driver's license.
(Source: P.A. 92-386, eff. 1-1-02.)
(215 ILCS 5/500-107 new)
Sec. 500-107. Self-service storage facility limited line
license for self-storage facilities.
(a) Except as permitted by subsection (j) of this
Section, a self-service storage facility must obtain a
producer license or obtain a self-service storage facility
limited line license before offering or selling insurance in
connection with and incidental to the rental of storage space
provided by a self-service storage facility. The sale of
insurance may occur at the rental office or by preselection
of coverage in a master, corporate, group rental, or
individual agreement. The following general categories of
coverage may be offered or sold:
(1) insurance that provides hazard insurance
coverage to renters for the loss of, or damage to,
tangible personal property in storage or in transit
during the rental period; or
(2) any other coverage the Director may approve as
meaningful and appropriate in connection with the rental
of storage space.
(b) Insurance may not be offered by a self-service
storage limited line producer pursuant to this Section
unless:
(1) the self-service storage facility has applied
for and obtained a self-service storage facility limited
line license;
(2) at every rental location where rental
agreements are executed, brochures or other written
materials are readily available to the prospective renter
that:
(A) summarize clearly and correctly the
material terms of coverage offered to renters,
including the identity of the insurer;
(B) disclose that the coverage offered by the
self-service storage facility may provide a
duplication of coverage already provided by the
renter's personal homeowner's insurance policy,
automobile insurance policy, personal liability
insurance policy, or other source of coverage;
(C) state that the purchase by the renter of
the kinds of coverage specified in this Section is
not required in order to rent storage space; and
(D) describe the process for filing a claim in
the event the consumer elects to purchase coverage
and in the event of a claim; and
(3) evidence of coverage is provided to each renter
who elects to purchase the coverage.
(c) A self-service storage facility limited line license
issued under this Section shall also authorize any employee
of the self-service storage facility limited line licensee to
act individually on behalf and under the supervision of the
self-service storage facility limited line licensee with
respect to the kinds of coverage specified in this Section.
(d) A self-service storage facility licensed pursuant to
this Section must conduct a training program in which
employees being trained shall receive basic instruction about
the kinds of coverage specified in this Section and offered
for purchase by prospective renters of storage space.
(e) Notwithstanding any other provision of this Section
or any rule adopted by the Director, a self-service storage
facility limited line producer pursuant to this Section is
not required to treat moneys collected from renters
purchasing insurance when renting storage space as funds
received in a fiduciary capacity, provided that the charges
for coverage shall be itemized and ancillary to a rental
transaction.
(f) The sale of insurance not in conjunction with a
rental transaction shall not be permitted.
(g) A self-service storage facility limited line
producer under this Section may not advertise, represent, or
otherwise hold itself or any of its employees out as licensed
insurers, insurance producers, insurance agents, or insurance
brokers.
(h) Direct commissions may not be paid to self-service
storage facility employees by the insurer or the customer
purchasing insurance products. The self-service storage
facility may include insurance products in an overall
employee performance compensation incentive program.
(i) An application for a self-service storage facility
limited line license must be made on a form specified by the
Director.
(j) Nothing contained in this Section shall prohibit an
unlicensed person from enrolling, issuing, or otherwise
distributing certificates of insurance under a group master
policy lawfully issued in this or another state when:
(1) the enrollment or distribution is by an
employee of the group master policyholder;
(2) no commission is paid for such enrollment or
distribution;
(3) the distribution is incidental and ancillary to
the primary rental business of the group master
policyholder; and
(4) the group master policy is sold to the group
master policyholder by a licensed producer.
(k) Nothing in this Section applies to or affects common
carriers regulated by the Illinois Commerce Commission.
(215 ILCS 5/500-135)
Sec. 500-135. Fees.
(a) The fees required by this Article are as follows:
(1) a fee of $150 payable once every 2 years for an
insurance producer license;
(2) a fee of $25 for the issuance of a temporary
insurance producer license;
(3) a fee of $50 payable once every 2 years for a
business entity;
(4) an annual $25 fee for a limited line producer
license issued under items (1) through (7) of subsection
(a) of Section 500-100;
(5) a $25 application fee for the processing of a
request to take the written examination for an insurance
producer license;
(6) an annual registration fee of $500 for
registration of an education provider;
(7) a certification fee of $25 for each certified
pre-licensing or continuing education course and an
annual fee of $10 for renewing the certification of each
such course;
(8) a fee of $50 payable once every 2 years for a
car rental limited line license;
(9) a fee of $150 payable once every 2 years for a
limited lines license other than the licenses issued
under items (1) through (7) of subsection (a) of Section
500-100, or a car rental limited line license, or a
self-service storage facility limited line license;.
(10) a fee of $50 payable once every 2 years for a
self-service storage facility limited line license.
(b) Except as otherwise provided, all fees paid to and
collected by the Director under this Section shall be paid
promptly after receipt thereof, together with a detailed
statement of such fees, into a special fund in the State
Treasury to be known as the Insurance Producer Administration
Fund. The moneys deposited into the Insurance Producer
Administration Fund may be used only for payment of the
expenses of the Department in the execution, administration,
and enforcement of the insurance laws of this State, and
shall be appropriated as otherwise provided by law for the
payment of those expenses with first priority being any
expenses incident to or associated with the administration
and enforcement of this Article.
(Source: P.A. 92-386, eff. 1-1-02.)